Company culture is a buzzword. Business owners are routinely told about their need for company culture. And the rest of us talk about a company’s culture, or lack thereof.
It’s an important word for a reason.
Company culture plays a role in a business’ success. It’s not just about perks, like organic lunches in the break room or unlimited time off. It’s a common misconception that good perks of employment are the same as corporate culture.
In reality, the culture of a business goes deeper than that. It determines how clients think of a business. It alters how employees feel about the company. And it affects the turnover rate and productivity at the business.
A company cannot achieve its strategic goals if it does not have the right culture.
So, what is company culture?
Well, it’s a set of shared behaviors, norms, and values dictating the daily interactions between employees, customers, and higher-ups. Perhaps that seems like a buzz-definition (if that’s a thing).
The reason why company culture is so vaguely defined is because the minutiae vary by business. Each company’s rules and regulations, the workplace environment, and employee behavior all affect company culture.
It’s the vagueness that remains consistent across companies. Hence why we have a vague definition of what company culture is.
But, I’ve compiled more information about company culture so you develop a firmer grasp of what it is.
Four Types of Corporate Cultures
Adhocracy
An adaptive company culture, adhocracy culture focuses on developing the next innovation for the industry. To this end, it prioritizes individuality and creativity. It also promotes risk-taking among employees. The goal of adhocracy cultures is taking new ideas and turning them into business success and market growth.
Hierarchy
Contrary to adhocracy cultures are hierarchy cultures. These cultures are more traditional. They do not promote risk-taking, nor are they adaptable. Rather, they promote clear plans. Hierarchy cultures have a set chain of command and value stability and uniformity.
Clan or Collaborative
Clan cultures are collaborative. They are people-focused cultures that spread out authority so communication between all levels of employees is encouraged. Within these corporate cultures, employee opinions are taken into consideration during the decision-making process. Clan cultures remove the wall between executives and employees.
Market
The bottom line is promoted in market cultures, above any internal satisfaction. There is a clear line between executives and employees in market cultures. And these cultures value reaching goals, getting results, and meeting quotas above the happiness of employees.
What Does a Great Company Culture Look Like?
I mentioned earlier that the minutiae of company culture varies by business. This is true. And it makes figuring out what a great company culture looks like challenging.
Not impossible, though.
At the end of the day, great company culture shares several common traits.
Respect
We all expect respect from others. And, since many of us grew up with the notion of “treat others how you want to be treated,” we show strangers respect.
Respect is earned, though. We may give that initial respect, but if it isn’t returned, we stop. Do not expect respect from others if you are not respectful.
In the case of company culture, respect for employees comes in many forms. It includes recognizing employee contributions and seeking their input. It also involves caring for employees’ lives outside of the workplace.
It’s worth noting that respect is heavily tied into trust, as well. Companies who respect their employees trust them to work flexible hours or work remotely. That is because the company’s values fall in line with the employee’s values. Active listening, supporting employees, and communicating all play a role in building mutual trust and solidifying respect between employees and employers.
Fairness
As humans, we love fairness. We all want access to the same opportunities as others with the same experience. We all want compensation that reflects the amount of effort we put in at work. And we enjoy being at companies who do things according to merits, not politics or personal favors.
Fairness is crucial for a successful business. Without fairness, employees start feeling resentful. Their satisfaction drops, as does their productivity. Plus, it fosters a highly competitive and un-enjoyable company culture.
The main takeaway is to keep things fair for all employees. It makes employees happier and improves the quality of your workplace.
Credibility
In the workplace, credibility largely falls into the realm of doing what is being said. If managers consistently say one thing, and then never follow-through, their credibility weakens.
Companies where managers do what they say they will have strong positive impacts on their employees. Employee retention is high, for one. Compared to regular companies, employees with credible managers have five times more interest in working for a long period of time.
Employees are also more likely to recommend the company they work for. Further, employees are more motivated to go the extra mile for highly-credible managers, and have better satisfaction about their workplace.
Belonging
When employees feel valued and important within their workplace, they have a solid sense of belonging. This makes them enjoy going to work each day. And increases their interest in working for a company for a long time.
Ensuring employees feel they belong isn’t a complicated feat for companies, either. When employees are in a meeting, give everyone an equal chance to talk, if they want. Implement mentorship programs so the gap between experienced and new employees is smaller. Or incorporate resource groups for employees with shared interests.
There are many different options for doing it, but instilling a sense of belonging is key for good company cultures.
Effective Leadership
Without good leadership, teams will fall flat. They won’t be as effective. They won’t be motivated. And many will actually leave for different jobs.
Great leadership is key for good company culture. Leaders are responsible for aligning the goals and habits of their team. It is through their own communication, habits, and behaviors that team members gain a solid identity.
An effective leader engages with their employees regularly. They seek feedback and ideas from their team members. Their words and actions line up in their daily work. Plus, they avoid showing favoritism toward any of the people working below them.
Basically, leaders set the tone for their team when it comes to company culture. Not the other way around.
Transparency
Transparency seems like a simple concept. You just have to be open with employees, right? Open about expectations and open about following-through on any demands made. Open about daily tasks or the reasons behind emergencies.
And yet, despite sounding simple on paper, many businesses struggle with being transparent. At least fully. They will often have no issue with transparency in certain areas. But in other areas? No, thank you.
Transparency plays a big part in good company culture, though. With it, employees and businesses thrive. Without it, employees feel stifled and don’t live up to their full potential.
Innovation
Having an innovative workplace is the result of managers and other higher-ups creating a safe environment where employees share suggestions and ideas. This naturally makes the workplace more innovative because it brings about a larger pool of new ideas.
Now, what does innovation matter for company culture?
Because fostering innovation makes employees more loyal to a business. In turn, they demonstrate more motivation at work, and are willing to go the extra mile more often. In fact, employees who have an innovative workplace have a higher rate of recommending their business to other employees and potential customers.
There are plenty of benefits of having the right company culture for your business. So, don’t be scared about establishing the one you need. Once you know what makes a good culture, creating one isn’t as challenging.
In all of your opinions, what makes for a good company culture?